In the Solow Model, If a Country Increases Its Savings

Multiple Choice

In the Solow model, if a country increases its savings rate:

A) growth increases as the economy moves toward a new, higher steady-state capital stock.
B) growth decreases as the economy moves toward a new, lower steady-state capital stock.
C) growth increases as a result of a new, higher production function.
D) no growth occurs, since the steady state is unchanged.